Tesla is making moves as the world descends into trade war turmoil. For starters, Tesla buyers in China won’t be able to get their hands on the Model S and Model X. Across the planet, however, Tesla is launching new operations in Saudi Arabia as relations improve. 

Tesla customers in China won’t be seeing any more Model S or Model X EVs, just as Saudi buyers get the Cybertruck, Model Y

Some of the first casualties of the ongoing Trump-Xi trade war have names. As far as Chinese consumers are concerned, they won’t see much of the Tesla Model S and Model X anymore. That is, unless buyers and China peruse the used market.

The American EV automaker recently announced that it would stop taking orders in China for Tesla’s two most luxurious nameplates: the Model S sedan and the Model X SUV. As of today, Tesla’s Chinese website no longer offers the option to place new orders. However, the brand’s current Chinese inventory of Model S and Model X EVs is still available to buyers in the country. 

The two luxury EVs were caught in the crossfire of escalated trade war tensions between the United States and China. The People’s Republic raised tariffs on all imported US goods to an eye-watering 125%, including Tesla’s library of import-ready EVs.

In response to the raised tariffs, US President Donald Trump imposed retaliatory tariffs at the same 125%. However, the tariffs are in addition to the initial 20% duty on Chinese goods, per Bloomberg. That brings the total up to 145%. Imported luxury cars have a history of high sticker prices in China, but a 145% hike is simply untenable for imports. 

Granted, the American-made Model S and Model X are a very small portion of Tesla’s market in China. Last year, Tesla sold around 2,000 of the EV models in the country. The Model 3 and Model Y, on the other hand, roll off the line at the brand’s Shanghai plant, Gigafactory 3. In comparison, Chinese buyers purchased nearly 662,000 Model 3s and Model Ys.  

The shift to Saudi Arabian clientele indicates improved relations between Elon Musk and the country

Just as Tesla ceased exports of the Fremont, California-built Model X and Model S to China, it shifted some of its focus to Saudi Arabia. Yesterday, Tesla launched its operations in Saudi Arabia, lining a plaza in Riyadh with Cybertrucks and Model Ys.

The oil-rich kingdom could be a battleground market for Tesla and an opportunity to right the ship for the hurting brand. Saudi Arabia wants to bump its EV adoption rate up to 30% by 2030, per Reuters. To do that, Saudi Arabia seems to have smoothed over once-wounded relations with CEO Elon Musk and welcomed the brand’s vehicles. However, with BYD already on Saudi roads, Tesla may have its hands full.